While towns and cities have been fighting the spread of Covid-19, delayed economic plans and property taxes have limited local government revenues. State Office of Policy and Management (OPM) Undersecretary Martin Heft plans to help local governments get out of the financial crunch.
The Municipal Voice, a co-production by the Connecticut Conference of Municipalities (CCM) and WNHH, brought Heft on to talk about the Covid-19 crisis and its local effects with Brian O’Connor, CCM’s policy director.
CCM has helped the state understand the top crises in local governments and help the local level implement executive orders from higher up, O’Connor explained.
But many of the expenses for these efforts have come directly out of municipal budgets. O’Connor noted that many municipalities across the state have taken steps to adhere to Gov. Ned Lamont’s orders on how to house those experiencing homelessness without putting them at risk of contracting the disease. As municipalities secured hotels and other ad hoc spaces, some had to pay large amounts of money up front.
Heft said that OPM’s budget division has followed every grant with a goal for towns to get everything 100 percent reimbursed, through available programs such as FEMA or the CARES Act.
Some national organizations like the National League of Cities that the CARES Act does not provide enough direct funding to local governments, as it mandates funding for municipalities with populations over 500,000. Bridgeport, Connecticut’s largest city, has a population of about 145,000.
Towns and cities should expect a letter from the OPM Secretary Melissa McCaw, Heft said. The letter outlines the aid OPM has identified and requests estimates of municipal expenditures.
Reimbursements from FEMA and the CARES Act are not municipalities’ only concerns, O’Connor said.
“It is critical that the money that municipalities rely on is released,” O’Connor said.
Heft discussed issues like Payments-In-Lieu-Of-Taxes (PILOT) grants and mandates that are under or unfunded that municipalities raise money towards throughout the year.
PILOT is underfunded by about $350 million dollars, leaving towns and cities reliant on the regressive property tax, he said. A recent report from the Advisory Commission on Intergovernmental Relations (ACIR) noted that there were over 1400 mandates on municipalities.
Now is the time to start looking at some of the unfunded mandates and assessing if they are still serving their purpose, according to Heft. Some mandates can be streamlined, some should be modernized and some removed, he said.
Brian O’Connor declared this a silver lining.
“Some of the lessons learned means that some of this stuff will go forward as best practices,” O’Connor said.
“The Municipal Voice” airs every other Wednesday, the next episode airs on May 6. Listen to the latest episode by clicking on the video above in this story.